Tell me first. To be a cool place to live, what does downtown Dallas need? Action. Tons and tons of people, not all super-rich, not all homeless, either.

But that's the problem with downtown. Rich people in the towers. Desperadoes in the alleys. Long empty sidewalks between.

For that to change, downtown needs to become affordable to jobsians. Not rich. Not poor. Not white, black or brown. Just people with jobs.

Hal Samples

Developers Larry Hamilton (left) and Ted Hamilton are good guys, but even good guys can use a whop with a two-by-four once in a blue moon.

Guess what. I think maybe that door just cracked.

In a small room in the bowels of City Hall at 8:30 in the morning on one of those hard weather days last week, an obscure body voted to change direction on the renovation of a handful of old office towers—known as the Atmos Project.

It was the first hint of a whole new thing, and it only happened because some guys whopped the city upside the head with a two-by-four. I will come back to that, of course, because I know you love head-whoppings.

The important thing is this: The city board, whose name is too long for me to mention yet, voted to put way more subsidized low-rent apartments into the Atmos re-development deal than originally planned.

For decades, Dallas has taken federal funds designed to foster low-income housing downtown and used the money instead to make downtown hotsy-totsy. The result is what you see now—notsy.

Cool new residential communities are springing up all around downtown like wild roses in a graveyard. Making the drive into downtown, on the surface streets from almost any direction, you will traverse a newly vibrant corridor. In that sense, Dallas is really happening.

But downtown itself continues to molder, because City Hall has been trying to create the high-rise equivalent of a gated community downtown, and gated communities suck.

So now I guess I have to name the official board that did the vote, right? Here it comes: This was a vote of the Joint Board of Directors of the Reinvestment Zone Number Eleven City of Dallas, Texas Downtown Connection Tax Increment Financing District and the Reinvestment Zone Number Five City of Dallas, Texas City Center Tax Increment Financing District and Downtown Dallas Development Authority.

Could we agree to something here, just to move things along? How about we call them The Obscure Body?

OK. The Obscure Body is in charge of handing out millions of dollars in city tax money to developers who agree, in exchange for the loot, to come in and renovate old empty office towers as apartment buildings.

It sticks in my craw—does it yours?—to give tax money to people to pay them to do business. But if we didn't give developers this incentive, nobody would touch downtown—as few did from about 1985 to 2005—and downtown would just sit there and rot forever.

So this way we dish the developers some fairly huge amounts of our municipal wealth, along with state and federal money, and in return they create something that we want—a vibrant downtown.

But...and this is a major but...the downtown created under this system is almost entirely a creation of government, our government, by us, through our elected officials, with our money. So our government needs to have a strong voice in how the money is spent and what gets created.

The city has jurisdiction over money bequeathed to it by the federal government as "community development block grant" funds. That money, administered by the U.S. Department of Housing and Urban Development, carries specific strict legal requirements dealing with affordable housing.

If you use HUD money on a housing project, then at least 51 percent of the units in that project are supposed to be available at guaranteed low rents for 15 years or more.

Last summer I wrote two columns ("A Tale of Two Cities," May 6, 2010, and "Fee Fi Fo Feds," June 10, 2010) about two developers, Curtis Lockey and Craig MacKenzie, who claim that The Obscure Body has worked for years to defeat affordable housing efforts: They say the Body hands out the HUD money, but then they make sure no affordable housing or very little gets built downtown.

Lockey and MacKenzie say The Obscure Body screwed them out of $30 million on a downtown development deal because they were trying to do what HUD required by making most of their project affordable. Their complaint is still under review by HUD—a shoe waiting to fall.

But the accusations in this business also have an even nastier edge. Lockey and Mackenzie have alleged in a complaint to HUD that the behavior of The Obscure Body in particular and Dallas City Hall in general has been about keeping downtown white.

As an example, the developers pointed to the deal that The Obscure Body voted on last week—a deal in which the two men had no personal interest or role. The Atmos project is four buildings in all, usually called the Atmos Complex, at the east end of downtown. These buildings, long dis-used, no longer have any connection with Atmos Energy, the natural gas utility that once owned them.

The accusation here is a touchy one, because it involves Ted and Larry Hamilton, who enjoy high respect for the quality of their work in downtown on other projects, and John Greenan, executive director of Central Dallas Community Development Corporation, an offshoot of Central Dallas Ministries.

Greenan is the financial maestro behind downtown Dallas' one affordable housing success story, Citywalk@Akard, which opened two years ago. The Hamiltons, meanwhile, were trying to do an entire building of affordable housing as part of their Atmos Complex Project.

There is a school of thought out there that the Hamiltons and Greenan are heroes—the last people who should be accused of practicing discrimination. That's certainly how I have always felt about them.

But Lockey and MacKenzie asked the State of Texas to take a close look at the way the Atmos project was being proposed. In order to get HUD money and state tax credits for the whole project, the Hamiltons and Greenan were going to jam almost all of their affordable units into one building of the four being rebuilt.

Lockey and MacKenzie are successful developers themselves, who have dealt with the City of Dallas on a number of projects. They say the Atmos project, as proposed, was a perfect expression of the culture of The Obscure Body, of the city's Economic Development Department and even of the city council.

It was segregation.

Hold on. Here is what you need to know. Larry Hamilton confirmed to me last week, a day before the meeting of The Obscure Body, that HUD had agreed with Lockey and MacKenzie.

Hamilton told me: "[HUD] alleged that because all of the 60 percent [low income] units were in one building and minorities would tend to make up a greater percentage of the low-income population, therefore we were engaging in racial segregation."

That's why the project came back to The Obscure Body last week, greatly modified to resolve HUD's objections, in part by increasing the overall amount of affordable housing in the whole project but also by mixing more of the affordable units into the fancier-schmancier buildings.

I called HUD and asked them to confirm or deny this. They would say only that the new version of the plan is under review, and they declined to comment on the old plan.

So if Hamilton is telling the truth—and of course he is—then we have to ask how it came to pass, before Lockey and Mackenzie raised their objections, that the Hamiltons, Greenan and The Obscure Body were about to launch on a project that HUD ultimately decided was racist.

Was it an accident? An entirely unintentional consequence of actions taken with the best of intentions? Given the players, that's where I want to fall.

But MacKenzie said to me last week that his research has led him to believe there are precious few accidents in the Dallas affordable housing picture.

"In the last decade, the City of Dallas has sponsored almost 8,000 low-income housing units in South Dallas," he said. "And in the same time-frame, guess how many they sponsored north of I-30. Twenty-five hundred."

Given the fact that most of the city's population lies north of I-30, MacKenzie said his calculations show that Dallas has built low-income housing in minority neighborhoods at five times the rate per capita of residents in those neighborhoods as in white neighborhoods.

That doesn't sound like an accident. It sounds more like the use of government policy and money to preserve and increase patterns of racial segregation.

But you know what else? People live and learn. MacKenzie was effusive in his praise for the way the Atmos project seems to be headed now.

I want to be effusive, too. The Hamiltons are good guys. Greenan is a brave pioneer. I even suspect the members of The Obscure Body are fairly OK, probably don't kick their dogs or pull their sisters' hair or anything.

But this vote of The Obscure Body came about because Lockey and MacKenzie whopped the city upside the head with a two-by-four by going to HUD with their complaints. This is a case of hurry-up, catch-up and probably a little bit of cover-up by a City Hall worried about even worse repercussions as HUD continues to examine the Lockey and MacKenzie complaint against the city.

All of which is great, in my book. Some lessons are hard to learn. Me, it was trigonometry. Dallas, it's always going to be race.

If you ask me, we all owe a huge vote of thanks to Lockey and MacKenzie for being resolute and forcing local government to do what it should have been doing all along—using our government money to create a cool, diverse, exciting downtown and not some pale imitation of Highland Park Village (a fancy place, if you're not from Dallas and reading this).

The point is learning the lesson. And if that's what the vote of The Obscure Body was—the lesson learned—then downtown Dallas finally will get out from under the albatross of discrimination and boredom and become the cool place to live it should be. I do think it's coming. I'm excited.

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My City, I have confronted the City of Dallas for years about this, my Mothers has been at City Hall for years since the late 70"s , won a lawsuit for this same thing. And today I can't live in my old Community. Freedmans Town / Uptown because they Divided and Conqured my neighborhood, and did it whit Poor Peoples Money! Tha Greedy took from tha Needey and they now call it GENTRIFICATION that's funny! How does Uptown and the Arts District feel to know that they are living in Section-8 Housing and in a STOLEN Community. HA HA HA HA!!!!! Get Up GET OUT I'm ready to come back HOME!!!!!!!!!!!!!!!!!!!!!!!!!

Hi, I have lived in downtown Dallas for the past 18 months. When I first moved into my building (Jefferson @1001 Ross), it was great, very professional, well kept and maintained. As I understand it, the building has made a decision to accept gov't assistance, I guess to fill vacant apartments.

Unfortunately that decision has caused the building to deteriorate, amenities are rarely working/available, hallways are not maintained as they once were and the caliber of people living within is very questionable.

Most working professionals have left and decided NOT to renew their lease while the remaining is patiently awaiting the end of their lease, then they will be gone. The decision to make the building low income accessible was a critical mistake for the livelihood of that building as well as downtown Dallas.

I would strongly urge officials to rethink their decision of making apartments in downtown Dallas accessible for low income. That decision will ultimately destroy the beauty of downtown as well as the newly renovated building.

Hi, I have lived in downtown Dallas for the past 18 months. When I first moved into my building (Jefferson @1001 Ross), it was great, very professional, well kept and maintained. As I understand it, the building has made a decision to accept gov't assistance, I guess to fill vacant apartments.

Unfortunately that decision has caused the building to deteriorate, amenities are rarely working/available, hallways are not maintained as they once were and the caliber of people living within is very questionable and not to mention all the "THUGS" just hanging around the lobby area of the building because their "homeboy" rents an apartment.

Most working professionals have left and decided NOT to renew their lease while the remaining is patiently awaiting the end of their lease, then they will be gone. The decision to make the building low income accessible was a critical mistake for the livelihood of that building as well as downtown Dallas.

I would strongly urge officials to rethink their decision of making apartments in downtown Dallas accessible for low income. That decision will ultimately destroy the beauty of downtown as well as the newly renovated building.

Schultz, maybe some new thinking is needed to build up downtown for all. Here's one idea.

Make Main Street a pedestrian walkway from Downtown through Deep Ellum to Fair Park. Then take it across the river to one of the main roads there .This would be Dallas's "Riverwalk". This would tie in all these areas - make a reason for people to go and live downtown, put eyes on the street, add some police on bikes or walking, add food carts, etc.Why won't it pass? No one billionaire developer reaps all the rewards, it doesn't really involve government interference, it helps all equally, and it would help put downtown Dallas on the map of intelligent city innovation.

I lived downtown from 1999 to 2005. You are so correct that Dallas would love to emulate Highland Park or even the TV show 'Dallas'. I walked to and from work, but for just about anything else I drove. Although if I needed a tomato, I walked to the Manor House, signed in, took the elevator to the 5th floor, and paid too much for it. The grocery was completed after I left, and it was initially advertised as upscale (as in $3 for a tomato. I loved living downtown. My loft was small, yeah, but I moved out only because the owners of my building decided that since the tenants liked it so much, they'll love buying their unit. I cried and along with quite a few of my neighbors, moved. I understand that now they are trying to lure renters back. But I see no point in it. ....the foot traffic was never there anyway.

I'm not one to follow the news much, but I work and travel through down town quite often. In my musings while driving, I often wondered about where people like me would fit in. I'm not low income and not high income. About lower than middle. I would like to know where the grocery stores are. The gas stations? Do the people living down town have to drive out of town to find them? If they do, can lower income people afford to do that?

I really should know better by this point in life to argue with the best journalist left in Dallas (although Wilonsky is getting close--when is the last time you found a cool picture of Dallas on ebay or a long lost recording from a Dallas show available?). But there is at least one statement in your article that just isn't correct. Larrey Hamilton didn't say that HUD alleged that the original proposal for the Atmos Project was a violation of Fair Housing. Larry Hamilton said that Lockey and McKenzie made that allegation.

The allegation is, as I've said before, a steaming piled of crap. I read the law (University of Minnesota, 1984, Law Review and Order of the Coif) and came to that conclusion. But not satisfied with my own opinion, I met with the best Fair Housing attorney in Dallas, and he reassured me that there was no Fair Housing violation (if you don't know who he is, then call me [you've got my number]). I wouldn't have gotten involved in the Atmos project otherwise.

What happened is that HUD entered into the catatonic state that is the response of any bureaucratic entity to having to make a decision. HUD wouldn't approve the Atmos Project. HUD wouldn't not approve the Atmos Project. There was a complaint out there. No bureaucrat has to answer for doing nothing.

Larry Hamilton, Ted Hamilton and I share one overriding passion--the love of downtown and urban development. We've probably never voted for the same candidate in any partisan election, but that doesn't matter for our working relationship. I've started redevelopment work by trying to provide housing for the lowest income group (the homeless), while Larry and Ted have worked with higher income groups, but the truth is that all of us love the city and really care about renovating beautiful old buildings and living in a vibrant urban core. If we can renovate a building for someone--and make the finances work--we don't care who lives in the building. Rich, poor, black, white, hispanic, asian, straght, gay, whatever--all we want is a vibrant downown.

So we revised the project to meet a standard that even Caesar's wife couldn't object to.

Because we have to develop downtown. It's a compulsion.

It's probably a disorder covered somewhere in the psychiatric literature.

You are absolutely correct that the City of Dallas totally governs what happens in downtown development. Nothing makes economic sense on its own. So if the City of Dallas is willing to support this--then that is what we will build. If the City changes its mind, then we will build something else. We're junkies. We need to develop the downtown and we'll do whatever the city wants to get our fix.

So did Lockey and McKensie do good? Well, maybe. I am not very impressed with the project they proposed. As someone who runs the only low income apartment building in downtown Dallas, I have severe doubts as to whether their project would have been successful.

On the other hand, I like the new reworking of the Atomos project better than our original plan. The spectrum of income levels is broader and better dispersed within the project. The original project would have worked well--and cost the city $3 million less. This iteration of the project will work even better, but cost $3 million more.

That's a policy decision for the guv'mint. Both versions of the project would make downtown better. Ted, Larry and I are going to build either way, if we can.

This is completely a political decision. Those of us who are involved in the redevelopment of downtown Dallas couldn't do a single thing without the financing provided by the city.

And we'd be happy to build whatever the political system determines is best for the city. Larry Hamilton lives downtown. My wife and I are moving downtown.

And if Dallas doesn't want to build a vibrant downtown, then we'll move some place that does.

I'm happy to see somebody else is keeping up with all this nonsense, but what I don't understand is how and why all the journalists out here don't dig deeper into some of the actual low housing issues going on. Maybe our journalists don't want to get their hands dirty? or be associated with people of lessor means? Too bad they just don't seem to want to help the poor victim thats been screwed by the programs the city offers. On the other hand, if enough people who have been screwed by the CITY and it's programs... get together, maybe there's a class action lawsuit waiting to happen... but then again I suppose not, since the Dallas Volunteer Attorney Program turns just about everybody down too.... so long Dallas!!

Hmmm, racial segregation via funding of low-income housing. Those racists sure are clever! And they would have gotten away with it too if it were for those meddling kids!

Let's see, the last data I could find says there are 484,117 households in Dallas (that's from 2000). Your article says that The Obscure Whatever has funded 8,000 (south) and 2,500 (north) low-income housing units in the last decade. Hang on, let me get my calculator ...... looks like that's 10,500 units. Okay, now the math gets really hard (for a journalist, anyway). 10,500 units divided by the total number of households (484,117) equals 0.0216889. Expressed as a percentage, that's 2.17%.

So, The Obscure Whatever Council has managed to cleverly, diabolically, and - most of all - racially segregate 2% of the Dallas households over the last decade.

Yes, I think you've pulled the rug out from under the Grand Plan to re-segregate the South. Damn, now we'll have to come up with another brilliant scheme and Jim, Lockey and MacKenzie can pile back into the Mystery Machine and drive off into the sunset.

the grocery store is located in the Interurban building with prices being comparable to an albertsons...There are also several 7-11s, Walgreens ans a CVS. There is only one gas station in the immediate downtown area and that is right next to Victory Plaza on Field.gas a lil higher but oh well...Most of the people that live in downtown do so for the "Urban Feel" If they need to leave downtown they take the trains if possible.. stop acting as if it's so exclusive.....It's not Highland park....

John Greenan: If I misquoted Mr. Hamilton, then it was because I misunderstood him. I still owe him an apology in that case. But here is the exchange on which I based that part of my column. I will let you judge what it sounded like he was saying. In any case, I probably should have asked to go back over it, which I did not. But here it is.We had just discussed the fact that the first building was to be 100 percent low income. I wondered why the Hamiltons were not applying for HUD money for that building.

I asked, “Well, then why wouldn't you want or get or qualify for the HUD money?”Larry Hamilton said: “Because they alleged that because all of the 60 percent units were in one building and minorities would tend to make up a greater percentage of the low-income population, therefore we were engaging in racial segregation, see.”I said, “So they just said no.”Larry Hamilton said: “No, they never said no. They never said yes. They just were hung up. So we took them off the horns of a dilemma and said OK we're just going to scrub that aspect of it.”

It didn't sound to me like he was talking about Lockey and Mackenzie, but he could have been, in which case I am glad you made this correction.

Well, between your ego and the egos at City Hall, there is not room for the other 1.5 million people in Dallas. Your disingenuous comments are sickening and you really underestimate the good common sense of the public. Were you a politician at some point in your past?

Let me guess, after you and your compadres, including City Hall, were exposed, you changed the project 180 degrees from the original plan, just out of the goodness of your hearts??? Yeah, and Charles Mansion is a born again christian!!!!!! Yeah, cant you see it in his eyes?

As far as your, "best fair housing attorney in Dallas"- Initials MD, well, in my opinion, he is part of the bigger problem that will come out later, Mr. Greenan. In my opinion, you went to the fox to talk about the hen house!!! And your case law selection is equally dismal. Try again! Your so far off base and in the dark its comical. But yet, you keep swinging that bat searching for the pinata, while blindfolded, with no chance at all of making contact. My advice - keep swinging, you have a long way to go.

Lastly, I live by a code, that actions speak louder than words, Mr Greenan. The actions show exactly what happened to the Atmos. The actions dont lie! Your actions do not lie. Hamiltons actions do not lie. The City of Dallas' actions do not lie. They tell the truth, while the words spoken are many times lies.

Please stay tuned to the actions in the near future, because they are just starting to get interesting.................in a big way.

I also remember your blogs in some previous articles about the Atmos project, whereby you stated your plan was great, wouldnt change under any circumstance, and it was the burden of others to prove wrongdoing to force the plan to change!

WELL, HERE WE ARE, THE PLAN CHANGED 180 DEGREES!!!

ACTIONS SPEAK LOUDER THAN WORDS! Remember?

Please do not sell the public short, and go try to sell your BS somewhere else.

Lastly (again, no really this time) its time for the actions of City Hall to stand up and be accounted for.................................stay tuned!!!!!!

Hey man, you really need to learn how to spell.......get spell check.........then, maybe you should consider becoming a writer, or perhaps go back and try to be a lawyer..........you seem to have a "real passion" for it.....and, with only one completed project under your belt, you're hardly qualified in any way to make the statements you have made here.

Like many others at City Hall, Zavitkovsky is just a "spin doctor", constantly "bobbing and weaving" a different story on a different day. Unfortunately, it has become part of the culture in the City's leaders......very sad.

I should have figured that the readers (and author) of this blog would completely miss the point of my reply, so let me spell it out so that a 3rd grader can get it.

The notion that these people have INTENTIONALLY tried to reinforce RACIAL segregation via low-income housing "schemes" is absurd. The reason that it is absurd is that, given the extremely small percentage of homes affected, it would be a completely ineffectual method of achieving such a goal.

Let me guess......so long as you and your family are not a part of the small percentage of the population being affected, you're OK with it. I'm also guessing if you and your family were in the small percentage (as you calculate it) of the impacted population, you'd have a completley different opinion, wouldn't you?

ScottR: The law says cities that accept CDBG money must "affirmatively further fair housing," not just with the CDBG money but in every penny they spend. Recent major court decisions and out of court settlements have shown that the courts take that admonition seriously. By using CDBG money in ways that reinforce segegation, City Hall has exposed the city to some serious liability. Take a gander some day at the Westchester County NY settlement (for some reason I see that I have always called it Westchester County, Connecticutt. Guess I'm a hick. )

Applying Scott R. logic - lets not prosecute child molesters seeing they are such a small percentage of the population......rapist, seeing they are such a small percentage of the population lets not prosecute them either. Lets save the Cities budget and do away with firemen and police, seeing that fires and crime is such a small percentage of the overall daily activity of the City. Great logic Scott R.

Lets all just employ complete and total ANARCHY.

The point is that it is against the law to do what the City of Dallas has done, so it has to be prosecuted and corrected.

Well thank GOD your not teaching finite mathematics, because to start, you have to use the right inputs for the calculations to work. Try it sometime, because just like in grad school, I cant do your homework for you, idiot.

If Larry Hamilton thought you mis-quoted him, I would have expected him to call you to try to correct the mis-quote. I don't think that Mr. Hamilton would have asked someone else to communicate that a mis-quote had occurred; that would just be illogical.

This all seems to be a tempest in a teapot. The concept is very simple, and I don't know why Jgreenan is struggling with it. Let's say there is an apartment complex out in the suburbs, garden style. You know, these types of apartments are all over Dallas. Let's say that there are 10 separate buildngs in this complex. Let's say the owner of the complex decides to put all of the disabled people in one building, all of the families with children in another building, all of the seniors in another building, and so on. By definition, what is the owner of the complex doing?............it's called "segregation".

Now, in the case of Atmos, there are only four buildings and they are located in Downtown Dallas, but the exact same principles apply. Seems pretty simple, doesn't it?

Earlier, Hamilton did refer to Curtis Lockey as having alleged that Dallas was continually seeking waivers from fair housing requirements. Then we talked about HUD and the fact that HUD was out of the first building. Then you see the rest of the conversation. I thought we were definitely talking about HUD. But that doesn't mean Hamilton could not have been thinking about both. Some reporter calls you up at the end of a busy day, you're not necessarly on your p's and q's like you were in a big deposition. That's why I should have gone back over it to be sure. But I hope you see why I took it the way I did.

JimS--I can certainly see how you got where you did with Larry's statement, But if you look at the second part of his statement, "No, they never said no. They never said yes. They just were hung up. So we took them off the horns of a dilemma and said OK we're just going to scrub that aspect of it.", [here HUD is "they", while before "they" was Lockey and McKenzie--so that is confusing] then I think it's pretty clear what Larry meant--of course I have the advantage of having sat through all the meetings and participated in the decision.

Anyway, your central point that this is all the City's decision is right on. Truth is, most developers build because they like to build stuff. If the City subsidized dog houses, then that's what you'd get.

The affordable housing in downtown went away when the City allowed the developers to pay off their Section 108 loans and get a release from the affordability requirement. To begin with, there were some (20%) affordable units. Maybe the City needed the loans repaid for another project(s), but that's the part of the process I've never understood.